Homegrown energy bar biz to build Pennsylvania plant

Mark HuffmanDecember 19, 2018

Kate Schade’s idea for a healthy snack turned into a business, and now that business is so successful she’s building a factory on the other side of the country.

Schade and partner Bruce Thaler announced last week they’ve cemented plans to build a 20,000-square-foot factory near Altoona, Pennsylvania. The facility, to be built on 1.2 acres, is a $5.1 million investment for the Victor, Idaho-based Kate’s Real Food, best known for its original Tram Bar.

The state of Pennsylvania liked the idea so much that it agreed to pitch in with grants and loan guarantees for the snack food factory. Plans are to have snack bars rolling off the assembly line by next August. Altoona, in south-central Pennsylvania, has a population of about 46,000.

The new factory will employ to 30 40 people and allow Kate’s to expand annual production from about a million bars to 12 million or more, said Jon Hill, the firm’s vice president of sales and marketing.

But the new factory doesn’t signal the end of Kate’s in its longtime home in Victor, Idaho, Hill said.

“It’s an expansion,” he said. “We’re not abandoning the community or taking jobs away — it’s an expansion.

“Victor is going to stay intact from the production standpoint, and it’s going to be Kate’s test kitchen,” he said. “Victor and Jackson will still be the center of innovation.”

Kate’s Real Food’s factory in Victor now has about a dozen people making her snack bars, along with company executives. The company is owned by menu director Schade and Bruce Thaler, an investor who came on after Schade began Tram Bar. Thaler is from Pennsylvania near the new factory, and identified it as a good place for the company to grow, Hill said.

Kate’e Real Food began with Schade making her own snacks for ski days. It grew into a small business and now offers six varieties of handmade bars. Plans are to continue the handmade angle, Hill said: “That’s a really big deal.”

Kate’s Real Food energy bars are now sold at a variety of outlets, including supermarkets, sports shops and convenience stores, and through outdoor retailers such as REI. Greater exposure in groceries is the next step and the driving force behind the expansion, Thaler said. He told Pennsylvania officials that “the biggest obstacle that we face at Kate’s is our limited production facility located in Victor ... We can only produce a limited number of bars at that location annually.” He said that with company expansion plans “we will need to produce millions of bars annually.”

The Altoona factory will initially have excess capacity that will allow it to accommodate other firms in “copacking” arrangements. That would allow Kate’s and other companies to manufacture their products on-site and cut costs for both through sharing the building and other aspects not directly related to the products they make.

The quality of Kate’s product and the handmade aspect is important, Hill said, in fighting for market against a variety of competitors, many larger and better known, such as Clif Bar, Larabar and Luna Bar. Kate’s products typically sell for more than those of other manufacturers, he said.

He noted that “it’s a very competitive field for energy bars” and that Kate’s Real Food has confidence in its product.

“We’re a competitive group and we have lofty goals,” he said. “We want to win the game.”

Stephen McKnight, the president and CEO of the Altoona Blair County Development Corporation, said the Kate’s Real Food “business culture and product aligns really well with our growing outdoor lifestyle, which is increasingly defining our mountain town.”

Tram Bar received about $176,000 in grants and worker training funds from the state of Pennsylvania and also approval for up to $2.65 million in low-interest loans through the Pennsylvania Industrial Development Authority.